May 13, 2005
AND LOWER:
Oil price falls as demand drops (Patrice Hill, 5/12/05, THE WASHINGTON TIMES)
A principal obstacle to economic growth came tumbling down yesterday as the price of oil plunged to $48.54 a barrel in New York trading on evidence that oil consumption in China is slowing dramatically.
Oil prices have dropped 16 percent from their peak close over $57 early last month, and gasoline prices at the pump have fallen in tandem. U.S. energy officials are so optimistic about the trend that they say the market may have peaked for the year, well before the Memorial Day start of the summer driving season.
Speculation can only prop prices up for so long. Posted by Orrin Judd at May 13, 2005 1:10 PM
After drops in January and February, China's March oil imports were up 23 percent. But at the same time, their oil exports in March were up 39 percent, and the International Energy Agency lowered its forecast for growth in oil demand worldwide. Until China's oil demand increases and they're not just buying it for speculative purposes, there's no reason why world prices should stay anywhere near $50.
Posted by: John at May 13, 2005 2:06 PM
It's weird. The oil stocks have dropped significantly in value. ExxonMobil is about 18% off its highs, which makes no sense given the small drop in oil price, and the relatively small share of Exxon's revenues that the marginal difference in price would make.
Posted by: bart at May 13, 2005 2:10 PMBart: that's lesser fools getting out early.
Posted by: joe shropshire at May 13, 2005 2:44 PM